Tips to reduce wasted spend in Google Adwords

5 Tips to Reduce AdWords Spend

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5 Tips to Reduce your AdWords Spend

How to optimise AdWords to reduce your costs and make your budget work harder

Updated: 27th December 2020 | Level: Introductory | Category: Guide

So you've been running Google Ads for a while, but you notice (or worse your boss notices) that your costs has started to creep up, seemingly for no reason. So how do you reduce AdWords spend whilst maintaining quality traffic?

How to reduce your Google adwords costs

Two of the most frequently asked questions we get from clients are 'how do I spend less on adwords?' and 'how do I reduce my cpc?'

Well unfortunately there is no one quick answer to these but our team have come up with the 5 tips to keep wasted AdWords spend down and reduce your overall account costs. But first a mention on  setting up your AdWords account...

You may be thinking what's going to change since I set it up? Well plenty, and many of these things may not necessarily be within your control. New competitors with similar products or services may enter your space, your keywords may be left behind as new search terms trends surface and of course Google likes to keep us on our toes with changes to the way things are done, particularly around spend.

Of these it's the last which has caught people out.  If you’re looking at daily overspend when you last viewed your account then don’t panic. Since October last year Google has changed the way it handles budget:

“Google 'can' spend up to 2 times your campaign's daily budget to show your ads on certain days of the week or certain times of the month based on fluctuations in traffic – but not more than you spend on your campaigns each month."

This new approach may or may not be ok for you, depending on your campaign strategy and how actively you manage your account.  Once you have an understanding of what can happen in spend it's time to review how you can impact it, positively.

Now for the 5 quick tips…

1. Review Spend Regularly

The underlying theme to this post and the biggest opportunity to reduce AdWords spend undoubtedly comes from actively managing your Google Ads account. i.e. regularly reviewing it's performance.  But how often is regularly? We'd suggest at least weekly to start with, then monthly (at a minimum) when you are happy you have eliminated the the largest cash black holes.

This is our number one tip, as if you don't check how your campaigns are performing you may not realise how much you are spending and on what until it is TOO LATE!

Make time to check your total spend and make sure that you are spending most in the areas that make you most money or help you to achieve your main goals.

At the end of the day you want to be throwing money away because you have too much not due to waste..

How to reduce adwords spend

Monitoring your keywords and quality scores at regular intervals, is also a good habit. Try weekly initially until your campaign is nicely tuned to a level you are happy with. Following this, an hour spent once a month is time well spent.

Tip: Remember making one change at a time will help you to see the impact of the individual changes.

2. Improve Quality Score

This is a biggie! Google is continually driving towards improved ad relevance. They want to make sure that people are seeing ads that most relate to their searches. The way Google does this is by giving advertiser's keywords a Quality Score, influenced by 3 factors: Expected CTR, Landing Page Experience and Ad Relevance.

And how does this relate to spend? The amount you pay for your clicks is directly influenced by Keyword Quality Score as shown here by Wordstream.

understanding google adwords quality score to help reduce wasting budget

Assuming your campaigns are well structured with ad groups that focus on specific areas, here are some simple suggestions to get your Quality Scores above the magic 7/10:

Expected Click through rate

"Predicts whether your keyword is likely to lead to a click on your ads" (Google). This is based on historic performance and click through rate of your ads. This can be improved following the same advice as recommended under 'Ad Relevance' below

Ad Relevance

"Measures how closely related your keyword is to your ads" (Google) so ensuring your keywords or phrases are mentioned exactly in your ad copy can immediately improve your Ad Relevance.

Landing Page Experience

Explains "how relevant and useful your website's landing page will be to people who click your ad" (Google). Landing pages that mention your keywords including in titles and headers as well as in the main copy will score better. If this status is showing as 'below average' then your website might need a few amends.
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3. Add Negative Keywords

It is vital to ensure that you have included negative keywords in your campaign, as without them you can waste your budget very quickly.

Negative Keywords allow you to exclude certain terms in searches for which your ad(s) will show.

You may want to consider words that are commonly linked to a word in your product name but which is irrelevant to your particular product. For example you may sell dog collars for pets but may want to exclude “vicar”.

reduce wasted spend in adwords using negative keywords

Competitor terms may also be worth adding as a negative and consider jobseeking or advice seeking search terms e.g. "jobs", "how can" - unless of course these are part of what you are advertising!

There are two approaches to adding negative keywords: firstly re-actively by checking your search terms regularly (as in the screenshot above) and adding terms that are unrelated to your products/services to your negative keyword list(s).

Secondly you could consider using a negative keyword tool, such as that provided by Wordstream: www.wordstream.com/negative-keywords

Tip: Negative Keyword lists can be added to share across multiple campaigns, saving you time editing individual ad groups. Add as usual but tick the Save to new or existing list box.

You can add negative keywords at either ad group or campaign level, individually or as lists.

To add negative keywords:

> Keywords  > Negative Keywords  > +

4. Check your Targeting

Occasionally when setting up a new campaign, for some settings you may think I'll come back to that later, when I have some data. This can be a good strategy but do remember to go back and review your data and make the appropriate changes.

Time/Scheduling
Making sure your ads are only showing when it's most appropriate, is key. Whether this is when your business is open, when you are able to respond or answer the phone or simply when people are likely to search for your brand, product/service directory or maybe researching a future purchase such as 'holidays in greece for families' or 'Tablet with longest battery life.

Consider scheduling different campaings for different times depending on where you audience is in the buying cycle. Above the fold brand awareness marketing might be best running at all times but having direct action campaigns running (for instance contact us type ads) should be disabled when you have no means to respond to those customer requests.

Having the right scheduling in place can immediately reduce unwanted clicks, save your budget and improve relevance for prospects and customers alike.

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If you have no schedule in place, using the dimensions tab, take a look at your results by day of week and hour of day to see when your ad is impressing most (and therefore more than likely being searched for most). You can then add a schedule to suit your needs.

To add a schedule:

> Campaign > Ad Schedule > Edit Ad Schedule > Select days & times > Add > Save

A note about 'Bid Modifiers' Once you have added and adjusted your base schedules, you can choose to add whats called 'bid multipliers' to specific periods of the day. Typically these adjustments, entered as percentage uplift or reduction should reflect the relative conversion rates of the subsequent traffic on your website or mobile app. For instance many clients find clicks late at night rarely convert, possibly because of clickers from overseas market (see Location targetting above) or maybe simply becuase they time-out accomplishing what they were trying to achieve and fail to return to the task the next day.  Either way, adding a bid multiplier of perhaps 20% for a sustained period of highly conversion rates is a good idea.

To bid adjust by time:

> Settings > Ad Schedule > Bid adjust. (for relevant device)

Location

One to watch is geographic targetting, which if left with default settings can result in your campaings being served to a wider audience that you might want.  Unless your an global ecommerce site with international shipping and 24 hour operations is likely that you'll want to incorporate some exclusions/restrictions in your geographic targetting.

The default targetting option for Search ads is 'People located in or interested in the following locations' which means that if you select 'UK' as your target then you'll get UK-based people (as determined by geo-location of IP addresses) and people located outside of the UK who are expressing an interest in the UK.  For location if you only want to target a specific area, make sure this has been selected. You can choose to add towns, cities, counties or countries. You can also, by selecting 'nearby', choose to target a radius around a certain location e.g. within 10 miles of Coventry.

Another consideration here is whether you would like to target people who are physically located in the location or those searching for the location, this can be specified in Location Options (advanced).

To add a location:

> Settings > Locations > Enter location name in box

Devices
For some campaigns you may want to target only specific device types or more frequently bid more aggressively for different device types across different campaigns and times of the day.  Google Ads offers three categories of device to choose from; Computers (including Desktops & Laptops), Tablets or Mobile (mobile browse not in-app).

Optimising around device types can be beneficial for a number of reasons (many similar to your scheduling optimisation reasons) for example reducing or excluding mobile devices if your landing pages has an extensive data capture form or performs poorly on a mobile device will save your budget for Computer clicks where you may not see such a significant bounce rate.

This targeting will help to ensure you won't waste money on the 'wrong' clicks.

To bid adjust by device:

> Settings > Devices > Change devices bid adjustment > Bid adjust. (by device)

5. Set Up Conversion Tracking

Many if not all of these optimisation tips to reduce your Google Ads spend should be atleast partically informed by your conversion tracking metrics. A click itself is unlikely to be the objective of your campaign, the users action on your website is what you care about. Knowing whether a users exhibitied the desired behaviour on your website after they clicked you ad e.g. Did they buy your product? Did they download your app? Did they complete your form? - is essential in ascertaining which clicks you want more of and which are not relevant.

These actions are referred to as "Conversions" - you can choose to track conversions from different sources: your website, app, phone calls or imported data (e.g. offline sales). For website and some apps this involves adding a snippet of code or tracking tag which tells Google when a specified action has taken place. For calls from call extensions or call only ads and for apps in Google Play this is done automatically. If you're a WordPress site check out our step-by-step guide How to Setup Google Analytics on WordPress.

Once your conversion tracking is set up this info can be reviewed easily at all levels by adding the conversions column to your table views in Google Ads. This data can then be used to decide which keywords or ads or time or location, etc to bid more or less for.

So to sum up...

By the time you have worked through these 5 tips to reduce your AdWords spend you should not only have saved a bunch of cash but also become a lot more familiar with the inner workings of Google Ads. Recording your changes and tracking the effectiveness of the changes in improved account performance should form part of a regular digital marketing activities.

Now it's up to you to keep your wasted spend down. Remember tip number one!

In this Article:


How to reduce your Google Ads budget and maintain performance

  1. The importance of Regular Checks
  2. Improving Quality Score
  3. Using Negative Keywords
  4. Tweaking your Targeting
  5. Conversion Tracking
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